United Kingdom economic growth for 2019 downgraded by International Monetary Fund amid Brexit uncertainty

Posted January 23, 2018

The IMF released an update of its World Economic Outlook on Tuesday.

In its latest World Economic Outlook (WEO) update, the International Monetary Fund has also projected a 7.8 percent growth rate for India in 2019.

She warned that there were risks ahead as well and called on world leaders to tackle debt and hard problems from inequality to climate change while they had the advantage of growth.

"This forecast reflects the expectation that favourable global financial conditions and strong sentiment will help maintain the recent acceleration in demand, especially in investment, with a noticeable impact on growth in economies with large exports", the agency said in its report.

The global lending agency said Monday it now projects Canada's economy will grow 2.3 per cent this year, up from an estimate of 2.1 per cent in October.

More news: India poll panel disqualifies 20 AAP MLAs

In its latest forecast, the Fund projects growth for Britain of 1.5 per cent next year, down from 1.6 per cent previously. Global growth forecasts for 2018 and 2019 have been revised upward by 0.2 percentage point to 3.9 percent.

India was the fastest growing country among emerging economies in 2016.

The 2019 growth projection for Japan moved to 0.9 from 0.8 percent. Absent reforms, the fundamental forces that had us anxious about the "new mediocre" - and future growth potential - will remain in place, she said.

While IMF officials remain tight-lipped about their report's content ahead of the World Economic Forum, which begins on Tuesday, Communications Director Gerry Rice has reiterated the importance of Christine Lagarde's "fix the roof while the sun is shining" message.

The IMF also upgraded its Japanese GDP forecast by half a percentage point to 1.2% for 2018, largely due to strong USA demand. "The effects of the package on output in the United States and its trading partners contribute about half of the cumulative revision to global growth over 2018-19".

More news: Pentagon Puts Countering China, Russia at Center of US Defense Strategy

"The US tax policy changes are expected to stimulate activity, with the short-term impact in the United States mostly driven by the investment response to the corporate income tax cuts", the fund said.

But it has warned that extreme weather events - such as droughts in Australia, and hurricanes in the Atlantic - pose a significant risk to its positive forecasts, saying "recurrent, potent climate events" impose "devastating humanitarian costs and economic losses" on affected regions.

She asserted said " Global growth has been accelerating since 2016, and all signs point to a continuing strengthening of this growth".This is why she has charged global political leaders to guard against the risk of complacency in the management of their economies.

"Weak inflation suggests that slack remains in many advanced economies and monetary policy should continue to remain accommodative".

More news: Australian Open: Nick Kyrgios topples idol Jo-Wilfried Tsonga in electric clash